The Society of Motor Manufacturers and Traders has called for the government to provide a dedicated 'Build Back Better' fund for the UK automotive industry, supporting its transformation and recovery from the pandemic.
Noting that the industry is worth £15 billion annually to the national economy, employs around 180,000 people and is the primary exporter of goods, the trade body outlined the need for financial aid to ensure its continued competitiveness.
Nissan is on the verge of confirming its own plans to boost battery production in the UK, with a new gigafactory in Sunderland set to open by 2024 and have an eventual output of 20GWh. A new Nissan EV is also on the cards for production in Sunderland, alongside the Qashqai, Juke and Leaf EV.
SMMT chief executive Mike Hawes welcomed reports of Nissan's plans but said that more needs to be done: "That's a tremendous boost in the arm, a real vote of confidence, but it's one. I've spoken about the level of capacity we have in the UK for battery capability; there's already a production plant in Sunderland, which they [Nissan] are looking to expand with their Envision partner. We need more than that.
"Germany has many times the capacity committed to investment, and we're seeing that across Europe. It's a fiercely competitive industry and, under the terms of agreement with Europe by 2027, to avoid tariffs, effectively batteries need to be made in the UK or Europe."
The news, if confirmed, will be "very good for the region" of Tyne and Wear, Hawes said, but to ensure further growth in the sector, the UK needs to have "the framework to attract battery investment and sustained manufacturing".
There's potential, estimated the SMMT, for 40,000 new jobs to be created across the UK automotive industry as part of the transition to zero-emissions mobility, but it added that without sufficient support and investment, some 90,000 jobs could be lost.
The fund would also be used to expand the UK's oft-criticised EV charging infrastructure, with the SMMT calling for at least 2.3 million new EV charging points to be installed across the country by the end of the decade.
The SMMT's 12 proposals also include support for the development of a 2GWh fuel cell gigafactory, a long-term strategy to develop apprenticeships and other training and changes to the tax system to help make the UK an attractive destination for investment.
The body has also called on the UK government to commission an independent review to consider the long-term future of fuel duty and CO2-based taxes, to continue plug-in hybrid purchase incentives and to continue to exempt ultra-low-emissions vehicles from taxation for at least five years.